Business leaders meet in Davos in bid to beat the odds

SummaryItalian premier Mario Monti will set the tone for beleaguered business and political leaders gathering in Davos this week for the annual World Economic Forum, with a speech titled “Leading against the odds”.

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Italian premier Mario Monti will set the tone for beleaguered business and political leaders gathering in Davos this week for the annual World Economic Forum (WEF), with a speech titled “Leading against the odds”.

The pow-wow will bring together more than 1,500 business leaders and up to 50 heads of state or government, many of them, like Monti, weathered by almost perpetual crisis as they fight to bring their economies and companies through global financial turmoil and a few homegrown scandals.

“It’s clear the future of the world economy is based on restoring trust. Restoring trust in leaders, restoring trust in our future. And this means we have to move out of this crisis mode,” WEF founder Klaus Schwab told a news conference.

There’s still some way to go, according to a survey by global public relations firm Edelman published on Monday. “There is an incredible lack of trust in leadership,” said Richard Edelman, the firm’s president and chief executive. “Levels of trust in governments are worse than for business.” Edelman’s annual survey across 26 countries did show a rise in trust in business and government over the previous year, but only 26% trust business leaders to solve social issues and 15% for government leaders, and 19% expected business to make ethical decisions, while only 14% said the same for politicians.

Edelman said trust in public figures had been eroded by scandals in the banking industry as well as controversies ranging from Lance Armstrong’s admission of doping, to the purging of Chinese politician Bo Xilai in a murder case and a sex-abuse affair at BBC.

Though Europe managed — just — to keep the euro zone intact in 2012 and Washington stepped back — at the last minute — from its “fiscal cliff”, a WEF survey this month showed business leaders and academics fear politicians are failing to address key problems.

And they will have it all to do again in 2013, subject to the ballot box. Monti will be defending his austerity measures in parliamentary elections in four weeks, and German chancellor Angela Merkel will be hoping a weekend defeat for her party in a regional election won’t derail her re-election later this year.

A contingent from the US including four secretaries and 14 congressmen will have another looming budget crunch at the back of their minds.

The WEF’s annual risk report cited inequality and the burden of government debt as the biggest economic threats and